Pedestrian Killed By Unlicensed Auto Driver: Karnataka HC Requires Insurer To Pay Her Family First, Then Recover From Owner

In brief

The question

1. Whether the Tribunal was justified in holding the insurer liable to pay compensation, despite the alleged licensing, permit and fitness-certificate breaches.

The court held

The appeal was allowed in part only to modify the award by directing the insurer to pay the compensation to the claimants in the first instance, with liberty to recover it from the insured without separate proceedings.

It also directed

The compensation assessment was not reduced.

The insurer was directed to deposit any balance within six weeks; the amount in deposit was to be transmitted to the Tribunal, and the entire compensation with interest was ordered to be released to the son, as the husband had died during the appeal.

01Facts

Smt. Shobha was struck by an autorickshaw on 31 August 2014 and died during treatment on 7 September 2014.

pp. 3–4

Her husband and son sought compensation under Section 166 of the Motor Vehicles Act, 1988.

pp. 3–4

The MACT found the autorickshaw driver negligent and awarded ₹14,39,365 with interest at 9% per annum.

pp. 3–4

The insurer appealed, challenging its liability on grounds including the driver’s lack of a valid licence and the expiry of the vehicle’s permit and fitness certificate, and disputing the compensation on the basis that the claimants were not dependent on the deceased.

pp. 6–7

During the appeal, the husband died and the son was recognised as his legal representative.

p. 2

02Issues

i.1. Whether the Tribunal was justified in holding the insurer liable to pay compensation, despite the alleged licensing, permit and fitness-certificate breaches.

pp. 5–6, para 10

ii.2. Whether the Tribunal’s assessment of compensation was excessive and required reduction.

pp. 5–6, para 10

03Law Applied

Under the Motor Vehicles Act, the insurer may be directed to satisfy a third-party compensation award in the first instance and then recover the amount from the insured where a policy breach, such as the driver’s lack of a valid and effective licence, is established.

p. 4, para 8 · p. 6, para 11

The Court applied the rule it attributed to Rama Bai v. Amit Minerals, 2025 SCC OnLine SC 2067, and held that the same approach applied to the alleged expiry of the permit and fitness certificate.

p. 4, para 8 · p. 6, para 11

The Court also relied on Shishu Pal v. Surjeet, 2026 SCC OnLine SC 1114, for the principle that a housewife’s services to her household are compensable and that her husband and major son may be treated as dependent on those services.

p. 5, para 8 · p. 7, para 12

Provisions in the judgment · 11 · Linked ones open on LawLens

Motor Vehicles Act, 1988 10 provisions

Section 173 Section 166 Section 134 Section 187 Section 3 Section 181 Section 5 Section 180 Section 56 Section 192

Indian Penal Code, 1860 Section 279

04Reasoning

The charge sheet disclosed offences under the Motor Vehicles Act relating to the driver’s licensing status, supporting the insurer’s challenge to its liability.

p. 6, para 11

However, because the deceased was a pedestrian and thus a third party, the Court applied the pay-and-recover approach: the insurer must first pay the award and may then recover it from the insured. It applied the same reasoning to the asserted permit and fitness breaches.

p. 6, para 11

On quantum, the Court rejected the contention that the claimants’ relationship or the son’s majority defeated dependency, relying on the recognised economic value of a housewife’s household services. It therefore found no basis to reduce the award.

p. 7, para 12